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Chicago Mercantile Exchange (CME)

Chicago Mercantile Exchange (CME)

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The Chicago Mercantile Exchange (CME) is one of the largest exchanges dealing in the trading of futures and options in the United States.

What Is the Chicago Mercantile Exchange? (CME)

Initially founded in 1898 under the name “Chicago Butter and Egg Board,” CME is one of the most important exchanges in the United States. In 1919, the exchange renamed itself the Chicago Mercantile Exchange and became a standard among traders in the country. While initially, the futures and stocks the exchange offered were focused predominantly on the foods and beverages industry, today CME is a leading exchange provider.

In many respects, CME is a revolutionizing force on the American stock market. In 1961, it was one of the first exchanges to start offering features. In 1972, CME introduced the first interest bond in the US, and CME was the first exchange  in 2000 to become a corporation, which is entirely owned by its shareholders. 

In 2007, the CME exchange entered into a merger agreement with the Chicago Board of Trade, essentially creating the CME group, one of the largest financial exchanges globally. Since then, the CME has been actively purchasing partial or full ownership in other exchanges all over the U.S., including the New York Mercantile Exchange (NYMEX) and Commodity Exchange, Inc (COMEX). In 2010, CME Group also acquired a 90% interest in the Dow Jones stock and financial indexes, while in 2012, the group purchased the Kansas City Board of Trade.

Another streak of revolutionary action on CME’s part came in 2017 when the Chicago Mercantile Exchange started actively trading in Bitcoin futures. Trading in futures has experienced a significant boost of interest from both enterprise and private investors in the past several decades. The CME group and all exchanges participating in it aim to provide a regulated, centralized environment with high liquidity , where investors can easily assume risks and bank on the fluctuation in prices of different assets.

CME Group is a big player in the exchanges industry in the United States. According to official CME reports, the corporation handles, on average, about 3 billion contracts worth approximately $1 quadrillion annually. This makes the CME group one of the most trusted exchange services providers in the US. The success of the Chicago Mercantile Exchange and its affiliates largely lies in the fact the group constantly diversifies the tools and products it offers to investors. One of CME’s biggest advantages is its Globex platform, which was a pioneer in introducing electronic trading in 1987. By introducing cryptocurrency futures to the global trading community, CME pioneers the worldwide adoption of the asset on traditional exchanges.